Rightways - Sowing the seeds of Succes

Thursday, 28 February 2013

Schoolboys do relaxation exercises in an all boys class at the government-run Shanghai Number Eight High School. Shanghai, whose school system produces the world's top test-scorers, has launched China's first all-boys high school program with an eye on elite overseas institutions like Eton. Source: AFP

SHANGHAI: Teenage boys in a Shanghai school are on the front line of
teaching reform after the world's top-scoring education system
introduced male-only classes over worries they are lagging girls.

Rows
of white-shirted boys are put through their paces as they are called up
individually to complete a chemical formula by teacher Shen Huimin, who
hopes that a switch to male-only classes will help them overcome their
reticence.

"We give boys a chance to change," she said.

The
Shanghai school system topped the Organisation for Economic
Co-Operation and Development's (OECD) worldwide assessment tests of
15-year-olds in 2009, the most recent available, ahead of Korea,
Finland, Hong Kong and Singapore.

But even so officials are
concerned that some male students may be slower than their female
counterparts in development and certain academic areas, such as
language, and the shift towards single sex classes aims to boost boys'
confidence.

Girls do better than boys in secondary school across the developed world, an OECD report found.

A prominent Chinese educator, Sun Yunxiao, found the
proportion of boys classed among the top scholars in the country's
"gaokao" university entrance exams plunged from 66.2 percent to 39.7
percent between 1999 and 2008.

Across the developed world, girls
do better than boys in secondary school, the OECD's Programme for
International Student Assessment (PISA) found in a 2009 report on the
educational performances of 15-year-olds.

"There are significant
gender differences in educational outcomes," it said, adding that high
school graduation rates across the OECD were 87 percent for girls but
only 79 percent for boys.

In response, Shanghai's elite Number
Eight High School is halfway through the initial year of an experiment,
putting 60 boys into two classes of their own - a quarter of its
first-year students - and teaching them with a special curriculum.

Schoolboys solve a math problem in an all boys class at the government-run Shanghai Number Eight High School in Shanghai.

"This is a big breakthrough," said principal Lu Qisheng. "There's lots of hope - hope that boys will grow up better.

"Boys
when they are young do not spend enough time studying," he explained.
"Boys' maturity, especially for language and showing self-control, lags
behind girls."

-- "We lack confidence" -

China shut most
same-sex schools after the Communist Party came to power in 1949, and
the only all-boys junior high schools in the country are privately run.

The number of male students scoring top marks in China's university entrance exams has plunged from 66 per cent to 49 per cent

Shanghai
does have an all-girls state-run high school, the former McTyeire
School for Girls, which marked its 120th anniversary last year and
counts the three Soong sisters - Qing-ling, Ai-ling and Mei-ling - among
its former pupils.

Between them they married two leaders and an
industrialist. Qing-ling married Sun Yat-sen, the first President of the
Republic of China, while Mei-ling wed Chiang Kai-shek, who would also
later become president.

Student Li Zhongyang, 15, said he felt
less shy about answering questions in his all-boys class, but drew hoots
of laughter from his fellows by suggesting an absence of girls let them
concentrate more on study.

"We lack confidence," he said. "The
teachers like girls, who answer more questions in class. This programme
lets us realise we are not worse than girls."

It is something of a
contrast to males' traditionally dominant roles in Chinese culture, but
principal Lu said the programme "doesn't have much relationship to
equality in society".

The scheme was launched after China's
government called for more "diversification" in educational choices
within the state system.

A Peking University professor has called
for an even bolder reform, suggesting in September that boys should
start school one or two years later than girls.

"The Chinese education system needs to improve and allow various education methods," Wu Bihu said on his microblog. Now Lu hopes to create China's first all-boys school one day.

"Ten or twenty years ago, there was no need for an all-boys class - just put everyone together," he said.

In
an increasingly aspirational society, he added, some families saw the
new programme as having connotations of top overseas private schools,
and so promising an advantage in the highly competitive gaokao.

Wednesday, 27 February 2013

Are you thinking of having or reviewing a competency model? Here are some tips on it

UNFORTUNATELY, the answer to this question, for many organisations, is a resounding NO!

Ever
since psychologist David McClelland suggested that we should move away
from the traditional measures of predicting job performance in Testing for Competence Rather than for Intelligence, in the early 1970s, many businesses and organisations have used some form of competency model as a key business tool.

Think
about your own business or organisation, I am sure that you “have had,
have, are thinking of having or are reviewing...” a competency model at
this time.

Where are you on that continuum? The key questions
are, “Why hasn't competency modeling delivered on its promise for many
organisations?” and “Do competencies really add value to businesses and
organisations?”

Have competencies been “a HR toy” and not a
business tool? Let's look at some of the research behind competency
modeling and see if we can answer these questions.

The use of competency models started with McClelland's work in the early 1970s.

A
decade later, in 1982, Richard E Boyatzis illustrated a logical,
integrated model of managerial competence in his seminal book called The Competent Manager.

His
model provided a context for understanding the demands of management,
and helped managers understand the competencies required to be more
effective.

So, given that we had a reasonable start to the use of
competencies in business why haven't competency models delivered
greater impact into organisations?

In The Leadership Machine,
Lombardo and Eichinger showcase research indicating that most
organisations and their leaders identify the wrong competencies for
success they don't know how to get at the essence of competency
requirements.

They also show that many competency models are too
compound trying to cram too many competencies into just five to 10
statements and hoping that will do the job!

In addition, a set of
“Core Competencies” can't do the whole job for an organisation either
jobs and roles are unique and generally require 20-25 competencies to
describe the “Success Profile”.

The truth is all organisations need multiple competency models to fit their many different needs.

Yet, many organisations seem to think that a “one size fits all” approach will work. It's not that easy, I'm afraid.

A great starting point for an organisation, however, is a “Strategic Leadership Model”.

At
least, that will let your leaders and aspiring leaders know what the
organisation (normally the CEO and the board) thinks is going to be
required to be a successful leader over the next five years or so.

A global Conference Board
study from 2012 asked senior executives what were the most important
items on their talent agenda. The top four (in order) were:

Grow talent internally;

Improve leadership development;

Provide training and development; and

Hire talent in the open market.

These are all great things to do high on your agenda, too, no doubt!

My question is the same for each point grow to “what”, improve against “what”, develop to “what”, hire against “what”?

I'm sure that you get my point.

Unless
you can clearly define what you need in each area usually through a
good Competency Model then you really don't know how to direct, focus or
orient your growth, leadership development or hiring. Competency models
are very powerful tools in this regard.

There are many good
researches that show how the effective use of competency models can make
a powerful business impact for an organisation.

Here are just a
few. A longitudinal study by Russell in 2001 showed that top-level
corporate executive performance can be reliably predicted by a
leadership competency model. In addition, he showed that a
competency-based executive assessment and selection process lead to an
increase of US$3mil (RM9.29mil) in annual profit per candidate selected
into the organisation.

Pluzdrak conducted a study in 2007 on the
effectiveness of a Leadership Development programme and showed that
positive changes on the key leadership competencies of individual
leaders were positively correlated with both increase in net revenues
and profitability!

A 2008 study by Clark and Weitzman used
regression analysis to show that the demonstration of 13 core management
competencies accounted for 54% of the difference in first-year sales
commission and 30% of the difference in levels of retention.

They
also found that developing people to be one standard deviation better
on the key competencies driving performance generated an additional
US$467,000 (RM1.45mil) per person every year!

The original
question for this article was “Are we competent with competencies...?”
Take a good, hard look at your own organisation and ask the same
question.

If your answer is “No, not really... Not as good as we
should be...” then remember that you can be and that there is every
reason “Why you should be” and “Why you need to be”.

Talking HR with Graeme Field

Graeme
Field believes that doing the basics' right getting the fundamentals in
order is key to driving organisational success in the future. What we
do operationally' today really does impact what happens strategically'
tomorrow!

“Malaysian
employers generally find it hard to converse with their employees on
the matter of their productivity. It may be because they don’t want to
be put in positions where they have to confront their subordinates,” he
said.

Sivalingam also said workers in foreign countries were constantly under probation which keeps them performing at their best.

He
said managers need to develop a proper key performance index system and
see to it that employees understand how they are being assessed.

“But
compared with Singapore, Hong Kong, Taiwan, South Korea, Japan and the
United States, we are still far behind,” Razali said.

He added
that the country was still recording an average productivity growth of
4.5% annually, which was lower than that of Indonesia and India.

Labour productivity levels are measured by the real gross domestic product over the number of workers in the country.

“In other words, it is how many workers it takes to produce a profit,” said Razali.

According
to the report, which analyses information from the Department of
Statistics, workers in the top benchmark countries outperformed
Malaysian workers almost six times over.

American workers topped
the list with a productivity level of RM285,558 a year, followed by
employees in Japan (RM229,568) and Hong Kong ( RM201,485) (see graphic).

In
2011, Malaysia had a productivity growth rate of 4.55%, which MPC said
was on track for the country in becoming a high-income nation by 2020
with a productivity level of RM87,500.

However, Malaysians lost
out to several benchmark Asian countries like China, which had a growth
rate of 8.7%, Indonesia (5%) and India (4.8%).

“Even though we
can see there is growth based on the data we have, Malaysian workers
have not been creating enough with the resources that we have,” said
Razali.

He clarified that an employee's productivity was not
measured by the number of hours clocked in but rather by his or her
overall output during working hours.

“Actually, most hours are
not spent being productive. We have had foreign agencies complain that
their Malaysian staff were taking very long tea breaks,” he said.

Razali said that working long hours could even be counter-productive.

“There
is a lot of waste in productivity when you drag the hours ... The
company would have to pay more for electricity and overtime,” he added.

Razali said management practices should be reviewed to boost productivity.

He
stressed the need to reward employees for better productivity with gain
sharing, and suggested project-based incentives, improving workplace
conditions and providing more flexible time for employees to rest while
on the job.

According to the report, productivity levels grew by
2.82% with improvements in labour efficiency recorded in five key
economic sectors.

Productivity levels in the services sector expanded by 4.9% to RM53,938 in 2011.

The agriculture sector grew by 6.23% to RM29,466, while manufacturing increased by 1.97% to RM54,509.

Construction
productivity levels went up by 3.09% to RM24,635 in 2011, while the
mining sector recorded a negative productivity growth of -6.14% to
RM866,246 from RM922,914.

Asked why the mining sector had a
negative productivity rate when its turnover was higher than other
sectors, Razali said this was because the turnover did not correlate
with the large workforce.

Monday, 25 February 2013

Helping others: Chin showing a mobile app “Watch Over Me” which she developed after she was nearly abducted.

PETALING JAYA: Although former Internet marketeer Chin Xin-Ci has
recovered physically from her near abduction, the emotional scars are
taking longer to heal.

Chin suffered cuts after a cleaver was
pressed against her neck by a couple of would-be rapists who pounced on
her at the car park of The Curve at around 5.20pm on May 27, 2012.

Two men forced her into the car but she escaped by running out of the vehicle as it was exiting the car park.

Chin
has used the experience gained from the terrifying ordeal to good use
by developing a smartphone application for personal safety.

Produced in partnership with an app developer, “Watch Over Me” allows users to register for an event.

If
they don't “check-in” within a certain time period, a message will be
sent out to emergency contact numbers while the camera and voice
recorder will be activated automatically and stored in servers.

“With a lot of the other personal safety mobile apps, you'd have to reach for the phone, unlock it and hit the panic button.

“Watch Over Me' also has a GPS tracking system that allows others to determine your location.

“If
I had been abducted on that day, no one would know that I had gone
missing until the next day,” said Chin, adding that she had been working
on the app since October to make it more user-friendly.

After the attack, Chin slipped into depression and went through therapy for four months.

She only started driving alone this year and still does not go to shopping malls alone.

“At first I felt like a zombie.

“There was a lot of fear and anger from having suddenly lost my sense of security,” said Chin.

She added that the attack had made her even more paranoid.

Chin uses the app all the time, together with the 40,000 other users who have downloaded “Watch Over Me”.

“I hope more Malaysian women will use these types of applications.

“If
something bad happens to you, at least people will know where you are
and some evidence would be captured through the voice recorder and
camera,” she said.

Malaysia’s vanguards

SIMPLY put, Design Thinking produces creative solutions to solve
complex problems. In other words, you have to be creative to be
innovative. But can one learn creativity or for that matter, innovative skills?

Yes,
if you believe David Kelley, the design thinking guru and founder of
global design firm Ideo and the School of Design Thinking at Stanford
University.

“So many people think that it’s kind of in your gene – you’re a creative person or you’re not. I don’t buy it,” says Kelley in Design & Thinking,
a documentary on design thinking by San Francisco-based One Time
Studio. Kelley argued that human beings are naturally creative (just
observe kids!) and you just need to rediscover your creative confidence
to crack open the door to innovation. The process of design thinking is a
“scaffolding for creativity” as design thinking advocate, Tim Brown of
Ideo, calls it.

Hence when Genovasi was initiated by the
Government to produce “innovation ambassadors,” the organisation settled
on design thinking methodology to cultivate these innovators.

“We
wanted an approach that would instil a sense of curiosity for
technology and entrepreneurship among youths. And any innovation that
derives from the approach should include empathy towards the needs of
people,” says Datuk Seri Dr Kamal Jit Singh, chief executive officer of
Unit Inovasi Khas (UNIK) which manages Genovasi.

“Design thinking fits these criteria perfectly as it offers a human-centred approach to innovation.”

Under
the Innovation Ambassadors Development Programme, participants go
through a 10-week programme to grasp the nuts and bolts of design
thinking and apply their know-how to solve real-life problems posed by
project partners. To date, project partners include The Millennium
Project, an independent, non-profit think thank, and RSA (The Royal
Society for the Encouragement of Arts, Manufactures and Commerce), a
London-based charity committed to finding innovative solutions to
today’s social challenges. Upon completion of the programme, these
“ambassadors” may go on to create startups or find placements in
Genovasi’s partner organisations like government agencies, GLCs or
corporations.

“These Ambassadors are expected to bring positive
changes to three core areas: improve public service delivery within
government departments, ministries and agencies; improve the quality of
life in rural and local communities and create new economic wealth
through entrepreneurship or industry game-changing efforts,” says Dr
Kamal. Genovasi’s plan is to produce a minimum of 5,000 Innovation
Ambassadors over the next five years.

As collaborators, the
Hasso-Plattner-Institut (HPI) School of Design Thinking in Potsdam,
Germany, not only helped develop the programme for Genovasi but also
conducted strategy and trainers’ workshops and assessments.

“It
was really great to see there are a lot of Malaysians who are keen to do
something under the innovation programme,” says Dr Claudia Nicolai, the
general programme manager of HPI D-School. Nicolai was in Malaysia to
help set up the programme. “People are extremely open-minded and willing
to work together.”

“Malaysia’s advantage, compared to Germany,
is that you are so diverse. You have influences from different ethnic
cultures, customs and religions – that’s an advantage to generate truly
creative ideas.”

The D-School in Germany did not copy and paste
Stanford University’s D-School model but instead adapt it to the
European environment.

“Genovasi’s programme is basically an Asian
version of what we are doing. It puts a new flavour in design
thinking,” says Professor Ulrich Weinberg, HPI D-School’s director.

“You
have the chance to build on the experiences of Stanford and HPI,” he
adds. “You can build something which is the next version or reinvent
what we’re doing.”

The Innovation Ambassadors Development
Programme (IADP) is open to university students or entrepreneurs up to
the age of 35. Students and experts from all disciplines are welcome to
apply. The programme is free for Malaysians. IADP’s second intake starts
from May 27. Closing date for application: March 31, 2013. For more
info, go to genovasi.my

Grooming innovators

To produce innovative Malaysians, innovation agency Genovasi
teamed up with a Germany-based institute to teach ‘design thinking’. We
travel to Potsdam, Germany, to find out more about this creative
approach.

You can’t
help but feel the creative vibes and peppy energy that emanate from the
Hasso-Plattner-Institut School of Design Thinking (aka D-School).
Located in the historical city of Potsdam, southwest of Berlin, D-School
is part of the Hasso-Plattner-Institut, an IT-Systems Engineering
university founded by Hasso Plattner, the man behind software giant SAP.

We
are on a media familiarisation trip organised by Unit Inovasi Khas
(UNIK), an innovation agency under the Prime Minister’s Department, to
get an insight into D-School, which partners Unik to train Malaysian
youths to become innovators.

Founded in 2007, the D-School
curriculum is based on the “design thinking” process – an approach that
looks at users’ needs and desires, leading to sustainable innovations
that can make people’s lives better. It is not about design per se.

And
unlike the mythical lone genius inventor, design thinking involves
teamwork. It draws on the expertise of individuals from varying
backgrounds and disciplines, from engineers and anthropologists to
accountants and fashion designers.

Hardly a newfangled idea
making its runway debut, the concept has been bandied about for decades
and used as a mantra by some of the biggest creative companies in the
world, including San Francisco-based global design firm Ideo.

But
the methodology was pioneered from Stanford University in California,
and taught and explored at the Hasso Plattner Institute of Design at
Stanford since 2005. As part of the coursework, students get to work on
real-life “design challenges” developed together with project partners
from the industry, public sector or non-profit organisations.

Take their design project with Shimano, the
leading supplier of bicycle components in the world. In 2004, Shimano
was grappling with stagnated growth in its high-end road-racing and
mountain-bike sectors in the United States. Driven by technology
innovations for years, the company’s initial instinct was to introduce
high-end casual bicycles that might appeal to baby boomers.

But
with the help of Ideo, adopting the design thinking method, the company
realised they should reach out to the 161 million US adults who aren’t
riding bicycles. Using a human-centred approach, Ideo and Shimano hit
the streets to survey why 90% of American adults do not ride bicycles.
Findings reveal that the complexities (like shifting gears) and costs of
modern bikes, the high maintenance, and the danger of cycling on roads
are factors that put off casual cyclists.

Shimano then partnered
with bicycle manufacturers like Giant, Trek and Raleigh to produce a
biking experience that stirred up childhood memories of simple, joyful
riding. These “coasting” bicycles have coaster brakes (back pedalling to
brake), automatic shifting and puncture-resistant tires to make cycling
easier and low maintenance.

To ensure a holistic experience, a
comprehensive website helps people to locate safe places to ride.
Shimano also launched a trade campaign and training curriculum to
educate retailers to better serve recreational customers. In six months,
the three manufacturers sold out the 30,000 Coasting bikes produced.
“Design
thinking is a mindset and a set of methods you can use to solve
problems that can impact society and businesses,” explains Dr Claudia
Nicolai, the general programme manager and lecturer of D-School, on our
visit.

“It’s not like it has never been done before,” admits
Nicolai who has been studying strategic innovations, the precursor to
design thinking, for a decade.

“What it does is to combine different methods and developments and put it under the design thinking label.”

At
D-School, there are three core elements in design thinking: focus on
multi-disciplinary team, team-supported space that is highly flexible
and dynamic, and the process itself, Director of D-School Professor
Ulrich Weinberg added.

Dubbed the “grandfather of computer graphics in Germany,” Weinberg is instrumental in getting D-school going from the beginning.

He
has 25 years of experience in 3d animation, simulation and computer
games. At D-School, the course runs over one term (Basic track) or two
terms (Advanced track) spanning 12 weeks, and students are assessed
based on their teams.

“What I learned in the last five years is
that you will not get the full, dynamic energy of the people, whether in
companies or schools, if you have incentive models that focus on
individual performance.”

In recent years, huge corporations in Germany are also jumping in on what D-School is doing.

“Companies
are calling us to partner on projects or to book workshops on design
thinking,” says Weinberg. Some of D-School’s partners include industry
giants like Siemens, Johnson & Johnson, DHL, Panasonic and Lufthansa
Airlines.

The enthusiasm of D-School students is as infectious as their teachers’.
“I
think the key benefit is learning how to design for people, focusing on
their needs or wishes. You are not trying to sell things but to fulfil
needs,” says Juliana Paolucci, 24. A product and graphic designer from
Brazil, Paolucci and her teammates Andrezej Karel, Sabrina Meyfeld and
Laura Kroth are working on a design challenge for Genovasi. Their
subject: how to engage young people in the development of the community.

They had to set out to find solutions that can convert Malaysian youths from armchair critics to empathetic doers.

“The
youths are the future of the country, they need to engage the community
and change reality,” explains Paolucci. “But first we need to find out
their needs, wants and desires, and ways to fulfil them.”

“Also
we need to take into account activities they like to do, for example,
how do they use social networking to take community action?”

Using design thinking methodology brings together different actions in a structured way, Karel added.

“The
first idea might not be the best solution, so we go through an
iterative process multiple times: understand, observe, define point of
view, ideate, prototype and test,” says the 25-year-old Polish who is
working on his thesis for his marketing/management degree.

Room for failure is the DNA of design thinking.

“In
a conventional design process, you just sit in your room, and keep
going at it until you think it’s perfect,” explains Meyfeld, 27, a
communication scientist.

“But with design thinking, we’re out
testing prototypes on the second or third day and if it doesn’t work, we
start at it again.”

“I am keen on social innovation and want to
learn more about how to apply the methodology in my social enterprise,”
adds Kroth, 29, who studied communications and public relations. She
hopes to start a small business to bring people of different generations
together to develop dialogues on German history and keep history alive
for future generations.

D-School experience

As for
D-School alumni like Jeremias Schmitt, his experience prepared him for
how he wants to work with people and how to develop projects further.

“After
the D-School experience, students actually find real meaning in what
they do, why they do it and how they want to do things,” quips the
27-year-old Berliner.

“Some even applied for jobs that they never
thought of applying, for example, a student who studied information
science seeking for a business development job.”

In Europe, more and more start-ups are using design thinking as a tool to innovate, Schmitt added.

So is design thinking the be-all and end-all of innovation? And how does one measure its efficacy or success rate?

“For
me, it’s not about how many products are successful in the market. I
care more about how design thinking deeply impacts the students, how
they got the chance to experience the process, and how it changed the
way they do things,” says Weinberg.

To date, D-School has done
about 70 projects. One-third of the ideas were implemented at some
point, the other third came up with solutions that led to different
things, and one-third led to nothing.

Clients who worked on the
project either left their companies or there was no follow-up from the
clients’ side. The role of design thinking at D-School is to create
innovators, not so much innovations.

In the case of Shimano’s
Coasting programme, three years after its initial success, the company
pulled the plug on the programme and manufacturers stopped rolling out
coasting bikes because sales fell below expectations.

Some
industry observers blamed it on the bike brands that weren’t doing their
jobs to communicate the benefits of Coasting to retailers and
customers, among other factors.

It wouldn’t be fair to say this design thinking experiment has flopped.

Suffice to say, design thinking isn’t the magic pill for success.

But
“use it to its advantage: to give new insights, outline new ways of
thinking, introduce new techniques or develop new entries to the
market,” as innovation and design writer/editor Helen Walters (formerly
with BusinessWeek and Bloomberg) attested in her talk “Design Thinking
Won’t Save You.”

Sunday, 24 February 2013

Muslims
at the Golden Mosque in Quiapo district of Manila on Saturday express
their support to Sulu Sultan Jamalul Kiram III and followers who are
Sabah in press for their claim. DANNY PATA

LAHAD DATU: Malaysia has extended the deadline for the Sulu armed
group to move out of Tanduo village and return home to today, following a
request from the Philippines.

The Philippine Government had
earlier asked for the deadline to be set for Tuesday to allow them to
persuade Sultan Jamalul Kiram III to order his brother Azzimudie Kiram
and the armed group of more than 100 to get out of Tanduo village in
Felda Sahabat 17 where they have been holed up since Feb 9.

Anifah, however, told The Star that he had conveyed the decision on the new Sunday deadline to Rosario.

“We are hoping the stand-off will end peacefully with the latest deadline,” he said, echoing Home Minister Datuk Seri Hishammuddin Hussein's statement that he wanted the two-week stand-off to “end sooner than later” without bloodshed.

Hishammuddin
told reporters in Kluang that the extended period would not be too long
as his ministry would leave it to the security forces to conduct an
operation to end the stand-off.

He said the Tanduo incident was
different from the country's past experience with armed groups such as
Al-Maunah, Abu Sayyaf and Jemayah Islamiah as this group claimed to be
descendents of the Sulu sultanate.

However, he said the country's sovereignty and the pride of the Sabah people must not be taken for granted.

The
priority of the armed forces was to defuse the situation without
bloodshed as it could affect Malaysia's good relationship with the
Philippines, he said, adding that the preparation for the deportation of
the Sulu group “is in the final stage”.

As the Philippine
Government tries to persuade the Sulu Sultan to take their Sabah claim
demand to a diplomatic level, the Kiram family has been adamant and had
asked Azzimudie's group to stay put in Tanduo.

Although emissaries have been negotiating with Azzimudie, the political pressure in Manila has been mounting on President Benigno Aquino
and his Cabinet to resurrect the long dormant Sabah claim following
talk that the Oct 15 peace deal with the Moro Islamic Liberation Front
had left out the Sulu sultanate as well as Nur Misuari's Moro National
Liberation Front.

To help defuse and bring the stand-off to a
peaceful conclusion, Philippine Defence Secretary Voltaire Gazmin said
he and his Malaysian counterpart, including the armed forces of both
countries, were closely coordinating their actions and exchanging
information.

Gazmin said the Philippine military had enforced a
naval blockade in the Sulu Sea to prevent undocumented Filipinos from
entering Sabah as reports emerged that other groups from southern
Philippines were poised to help Azzimudie's gunmen.

Stating that
the Sulu group was pursuing its Sabah claim the wrong way, Gazmin
revealed that six navy ships and a transport vessel were on standby in
Tawi Tawi, about a 15-minute fast boat ride to Tanduo village.

Saturday, 23 February 2013

Washington (AsiaNews/Agencies) - Japan's new Prime Minister Shinzo Abe is in the United
States to forge a new and closer alliance with the Unit States in opposition to
China. Elected in December, the hawkish Abe arrived in Washington yesterday. Today
he is scheduled to meet US President Barack Obama. The timing of the visit is
not accidental, given rising tensions with China over a group of islands and
North Korea's ever-dangerous threats

.In an interview
with a US paper ahead of his trip, Abe voiced hope that the US alliance - and
the presence of 47,000 American troops on Japanese soil under a security treaty
- would send a message to China. "It is important for us to have them recognise
that it is impossible to try to get their way by coercion or intimidation," Abe
explained.

The Chinese foreign ministry on Friday continued to slam Japanese Prime
Minister Shinzo Abe, who pointed the finger at China on a slate of
domestic issues during an interview prior to his visit to the US.

The ministry accused Japan of playing up the "China threat" with ulterior motives.

"China
is strongly dissatisfied with the Japanese leader's comments that
distort facts, attack and defame China and stir up confrontations
between the two countries," Hong Lei, spokesman for the foreign
ministry, told a press briefing.

Hong's comments followed others
from Thursday and came in response to Abe's accusations, which claimed
China had a "deeply ingrained" need to spar with Japan and neighboring
countries to "maintain domestic support," according to the Washington
Post.

Suga said the prime minister has
repeatedly emphasized the Japan-China relationship and would push
forward strategic and mutually beneficial relations.

Despite the
explanation, the transcript of the exclusive interview published by the
Washington Post on Thursday showed that the hawkish Japanese leader
lambasted China's political and education systems among other issues.

During
the interview, Abe said that under the one-party rule of the Communist
Party and having introduced a market economy, China needs to maintain
high economic growth by seeking resources through coercion or
intimidation while teaching patriotism mirroring an "anti-Japanese
sentiment."

"Obviously, Abe tries to tarnish China's image in the
international community and hype up the 'China threat' before talks
with Obama in order to win US sympathy and support," Lü Yaodong, a
researcher of Japanese politics at the Chinese Academy of Social
Sciences, told the Global Times Friday.

Hong said that only
Chinese people have the right to speak about whether China's political
system and development strategy are suitable.

"Only those with political bias and ulterior motives would maliciously interpret and blame them," he noted.

Huang
Dahui, director of the Center for East Asia Studies at the Renmin
University of China, told the Global Times that this reflected the
"value-oriented" diplomacy Abe has been adopting to "flatter" the US,
adding that the hawkish Japanese leader has also stressed propaganda
throughout his political career.

Abe was scheduled to meet Obama
on Friday. During a press conference on Thursday, White House Deputy
National Security Advisor Ben Rhodes said the meeting is a "further
symbol of the President's commitment to the US-Japan alliance as a
cornerstone of US economic and security policy, and as a cornerstone of
the US-Asia policy."

Danny Russel, senior director for Asia at
the National Security Council, said the two leaders are expected to
discuss maritime security issues and territorial claims both in the East
China Sea and the South China Sea.

In his interview with the
Washington Post, Abe also warned that without changing its current
policy, China would lose the confidence of the international community,
which will result in a loss of foreign investment.

"The logic is
ridiculous. It is Japan that has stirred up provocation by
'nationalizing' the Diaoyu Islands. It should rethink its own policies,"
said Lü.

Regarding such remarks, Russel said Obama would listen
to Abe's assessment and views on the current situation in the East China
Sea and the consultations between Tokyo and Beijing. He added that the
US opposition to coercive actions or unilateral steps threatening the
stability of the region has been "clear."

A commentary carried by
the Xinhua News Agency on Friday said the US should not be "hijacked"
by Japan over the territorial dispute with China, as the US support for
Japan on this issue "would not only damage Washington's credibility as a
constructive superpower, but also as an important partner of China on
many pressing global issues."

Huang said in terms of
China-related issues, the US would show its support to Japan as an ally,
but would not be led by Japan to sacrifice the China-US relationship.

“With the US economic recovery dragging its feet, it is
reasonable to think that some in Washington may want to make China a
scapegoat so that public attention is diverted away from the country’s
economic woes.”

China Daily also quoted defense ministry spokesman Geng
Yansheng as saying the People’s Liberation Army had also been targeted
in a “significant number” of cyberattacks.

“A considerable number” of them originated in the United States,
judging from the IP addresses involved,” he said, but added that he did
not “accuse” the US government of being involved.

According to Agence France-Presse,
Mandiant’s report alleges that the hacking group “Advanced Persistent
Threat” (APT1), was part of the Chinese military’s Unit 61398. Mandiant
also said APT1 have stolen hundreds of terabytes of data from at least
141 across 20 industries, some of whom are involved with US domestic
infrastructure.

But official state news agency Xinhua said the Mandiant report “reeks of a commercial stunt”.

The state news agency added that the US had a “matchless superiority
and an ability to stage cyberattacks across the globe”, and that the US
military had “established a significant cyber force, including the 780th
Military Intelligence Brigade, which is a regular military unit tasked
with carrying out cyber missions”.
In a further missive, Xinhua said Washington had a “habit of accusing other nations based on phony evidence,” adding:

“Facts will eventually prove that the cyberattacks
accusations are groundless and will only tarnish the image and
reputation of the company making them, as well as that of the United
States.”

The comments in China’s media comes after President Obama’s
administration executive order on February 12 which promised to
aggressively combat the increase in cyberattacks pursuing trade secrets
that could threaten domestic economic and national security, Mondaq reports.

In a report titled the Cyberspace Policy Review, the White House did not explicitly name China as a threat, but the inference was clear.

White House Press Secretary Jay Carney said Tuesday, “We have
repeatedly raised our concerns at the highest levels about cybertheft
with senior Chinese officials, including in the military, and will
continue to do so. This is a very important challenge.”

At a subsequent press briefing on Wednesday, Carney added there could be possible trade restrictions imposed on China.

But some experts say most the documented cyberattacks have been linked to Eastern Europe, with the remainder linked to the U.S. and only a handful to China.

“There are too many people right now saying, ‘the sky is falling,’
without proposing cost-effective solutions, which is causing a lot of
confusion,” said James Hendler, professor of computer science at
Rensselaer Polytechnic Institute in Troy, New York, IB Times reports.

Thursday, 21 February 2013

KUALA LUMPUR: Malaysia's economy recorded a spectacular performance in the last quarter of 2012, growing 6.4%.

This
is the highest quarterly growth since two and a half years ago and was
buoyed by robust manufacturing and construction sectors.

It supported the overall economic growth for 2012 that expanded to 5.6% compared to 5.1% in 2011.

Economists
polled by Reuters had forecast that the growth of the fourth quarter
would accelerate to 5.5% from 5.2% in the previous three-month period,
and forecast a full-year growth at 5.3%.

All sectors registered
positive growth with the services, manufacturing and construction
sectors continuing to be the key drivers in the supply side.

Many
experts believed that the Economic Transformation Programme, with its
multi-billion projects, had to a great extent supported the growth in
the construction sector that carried spill-over effects onto other
sectors.

Bank Negara Malaysia said total investment remained robust and was the main driver of growth during the quarter.

“The growth of private consumption continued to remain strong although the pace of increase moderated.

“The growth during the quarter also benefited from a significantly lower negative contribution from net exports.

“On
the supply side, most economic sectors recorded improvements in growth
during the quarter,” it said in a statement yesterday.

The main drivers of the economy in the fourth quarter included domestic demand that continued to expand by 7.5%.

Private
sector investment advanced by 20.2% supported by capital spending in
the domestic-oriented manufacturing and consumer-related services
sub-sectors, namely telecommunications, real estate and aviation and the
on-going implementation of projects in the oil and gas sector.

Investment
was also supported by capacity expansion in the primary-related
manufacturing cluster and capital spending in new growth areas such as
medical and communications equipment.

Public investment expanded
by 11.1%, driven by capital spending by public enterprises in the
transportation, utilities, oil and gas and communications sectors.

Bank
Negara said the headline inflation rate, as measured by the annual
change in the Consumer Price Index, continued to moderate to 1.3% in the
fourth quarter.

Going forward, Bank Negara said there were
emerging signs of improvements in the global economy where the latest
economic indicators also suggested further stabilisation in growth
performance in Asia. - The Star/Asia News Network

Wednesday, 20 February 2013

Robert Kuok, the Hong Kong-based Malaysian tycoon, is still the
richest man in Malaysia with a wealth of RM46.1 billion, up 0.88 per
cent from last year’s RM45.7 billion, followed by businessman Ananda
Krishnan and Public Bank’s Tan Sri Teh Hong Piow.

Ananda, in second position since 2004, suffered the biggest wealth
decline, falling by 23.5 per cent from last year, with his assets held
via Usaha Tegas Sdn Bhd worth RM32.90 billion as at the tabulation date
of January 18, 2013.

Teh, kept his place for the third year running with assets worth RM13.73 billion, business magazine Malaysian Business said in its February 16 issue.

It said that the combined wealth of Malaysia’s 40 richest individuals
rose slightly this year despite the volatile and choppy capital
markets.

They were collectively worth RM194.86 billion as at January 18, a
slight increase of 0.86 per cent compared to RM193.2 billion a year ago.

When Malaysian Business first started counting the wealth of
Malaysia’s 40 richest individuals in 2002, their combined assets stood
at RM41.7 billion and Kuok came out on top.

The magazine said that fourth on the list is Tan Sri Quek Leng Chan,
who jumped from sixth position last year, replacing Tan Sri Lee Shin
Cheng of IOI Group, who slid to sixth.

Quek’s wealth, through his flagship Hong Leong Group and Guoco Group, is valued at RM11.09 billion this year.

Tan Sri Syed Mokhtar Albukhary keeps his fifth position this year
with a wealth level of RM10.60 billion, up from RM9.53 billion last
year.

Lee slips from fourth position in 2012 to sixth with assets of RM10.56 billion.

Tan Sri Tiong Hiew King, through his vehicle Rimbunan Hijau Sdn Bhd,
is at ninth place this year with assets worth RM6.35 billion, a slight
fall of 1.01 per cent from that of last year.

Rounding up the Top 10 list is Singapore-based property tycoon Ong
Beng Seng, via Hotel Properties Ltd, with a wealth level of RM4.02
billion, a decline of 18.36 per cent from last year.

Malaysian Business said that one interesting fact was that
since 2002, 81 tycoons have joined the 40 Richest Malaysians list and of
that, 15 have managed to remain on the list continuously.

Overall, the steady increase of these tycoons’ wealth can be
attributed to share market performance and price inflation, given that
their wealth is largely based on their shareholdings.

It is also reflective of the performance of their companies and Malaysia’s positive economic growth over the past 12 years.

As for this year, there were 31 billionaires — one more than last
year — and 23 of the 40 in the list saw their assets increasing from
last year. Of these, 14 registered growth of more than 10 per cent.

There were three newcomers to the list. Datuk Desmond Lim of Pavilion
REIT made his debut at number 15, with a wealth worth RM1.869 billion.
The other two, Datuk Tan Heng Chew of Tan Chong Motors Holding and Tan
Sri Kua Sian Kooi of KSK Group, returned at number 37 and 40
respectively.

The full list of the 40 tycoons and details of their wealth appear in
the magazine. It also presents a list of the 10 richest tycoons on the
ACE Market.

As in previous years, the wealth of the Top 40 was assessed based on
the value of their stake in listed companies as at January 18. — Bernama

A LOT of heat is being generated both
here and in Australia following the Govern-ment’s decision to deport
independent Australian senator Nick Xenophon who arrived at the LCCT in
Sepang on Saturday.

He was detained as an undesirable person and deported on the first available flight back the next day.

There
is considerable support as well as condemnation for Xenophon’s
deportation, with many individuals and NGOs questioning his independence
and accusing him of coming here to interfere in our election system.

Those who condemn the deportation say it is authoritarian and reflects the Government’s paranoia of foreign observers.

Just who is Xenophon and what is the Australian’s relationship with Malaysia?

The
outspoken senator is a personal friend of Opposition Leader Datuk Seri
Anwar Ibrahim and one of his many sympathisers in Australia.

He
often speaks up on various Malaysian issues and has travelled here
several times, the last in April, at Anwar’s invitation to ostensibly
study the polling system.

But his critics charged that he is
heavily involved in supporting the Opposition and had even participated
in the Bersih 3.0 rally in April last year that ended in violence.

Xenophon’s
latest trip here was as part of a four-member Australian delegation
after the Australian government rejected Anwar’s request for independent
observers for the upcoming general election.

Xenophon was
deported, said our immigration authorities, because he had tarnished the
image of the country. He had been classified as a “prohibited
immigrant”.

The fact is immigration had blacklisted Xenophon
because he had attended the Bersih protest last year and for allegedly
making “baseless” allegations about Malaysia.

“He can’t pretend to be an independent observer as he is very biased,” said political analyst Dr Chandra Muzaffar.

“It
does not make sense trying to be an independent observer when he is
not. He is a very partial observer and was ready to denounce our
electoral process,” Dr Chandra said.

Xenophon had given a press conference in Parliament last year in which he lambasted the Government’s “electoral shortcomings”.

Among the issues he raised was the short campaign period.

He
also vocally objected to the fact that rural constituencies had a
smaller number of voters compared with urban ones which had many more.

He
compared Malaysia’s electoral system, which he faulted, with other
countries including Australia’s which he painted favourably.

But it is through his virulent anti-palm oil campaign that Xenophon first came to the attention of our Government.

Labelling has threatened big plantations and thousands of smallholders equally.

Xenophon
promoted the “Truth in Labelling – Palm Oil Bill” which was proposed by
environmental NGOs and supported by Xenophon because oil palm
plantations, it was said, contributed to deforestation and threatened
the orang utan.

The palm oil industry earned the country RM80bil in 2012 and provided hundreds of thousands of Malaysians employment and income.

But Xenophon couldn’t care less.

Eventually the Bill was defeated by an extensive information campaign mounted by Malaysia.

Lately,
Xenophon has emerged again on the Malaysian political landscape as a
human rights advocate who is concerned with our election laws and
practices.

He has allied himself with Anwar and with the
Opposition who now decry the fact that he had been deported rather
unceremoniously by an exasperated government that at one time had
tolerated him and allowed Xenophon free access.

The reality is
that many of these battles are actually trade wars waged in various
shapes and forms and which are heavily financed by our economic rivals.

The economic stakes are indeed high.

In his own Australia, Xenophon is viewed as a maverick and attention grabber who is into self-promotion.

Australian commentator Greg Sheridan, writing in The Australian, has this to say about Xenophon – he only campaigns for one side of Malaysian politics, the Opposition.

Sheridan
also wrote it was “stupid and impractical” for Australia to send
election monitors, citing Vietnam and Cambodia, and Malaysia “on any
measure is one of the most democratic and freewheeling nations in
South-East Asia”.

Indeed, Xenophon has come here on a number of
occasions, taken advantage of our openness and had even engaged in
grandstanding – not just in Parliament but also on the streets.

Monday, 18 February 2013

Distinguishing authorship

I REFER to the letter “Quality time supervising post-graduates” (The Star,
Feb 16 - attached below) where the writer said: “The supervisor obtains grants for his
research and allows you to use the money to do your research. There is
no reason why he should not claim first authorship”.

This was one of the responses to the letter “Stop practice of ‘free riders” (The Star, Feb 7- also attached below) which criticised the alleged practice of supervisors claiming authorship for students’ works.

It appears that there is a failure to appreciate the difference between authorship and ownership.

“Author”,
as defined under section 3 of Malaysia’s Copyright Act 1987, means “the
writer or the maker of the works”. It does not refer to a person who
pays for the work.

In our present context, authorship can only be acquired through some scholarly input into the work. Money cannot buy authorship.

Authorship must not be confused with ownership.

The latter refers to one’s property right in the work, which includes the right to exploit it for profit.

For example, an author and a publisher may co-own a work. But the publisher is not the author.

Likewise, the supervisor who has provided the funding may acquire ownership, but not authorship.

Being an author attracts certain rights.

No person may, without his/her consent, present the work without identifying the author or under a name other than the author’s.

This
is one of the author’s “moral rights” recognised by the law (section
25), which cannot be overridden without the author’s consent even if the
work is subsequently sold.

Of course, where the supervisor
constructs the framework for the research (more common for sciences than
for social sciences) and divides its components to be researched by her
students, the supervisor may appropriately be regarded as an author.
There is scholarly input on his/her part.

What about the credit due for supervision given?

This will depend on the common understanding between the supervisor and the student.

In
normal circumstances, the supervisor’s comments on a student’s work
does not give him authorship since it is either given gratuitously or in
pursuant to the supervisor’s obligation as a supervisor.

As the
legal holder of moral rights, the student may as a matter of courtesy
offer to include the supervisor’s name. But this is a matter of
discretion rather than obligation.

Supervision is a selfless
task. In my subject area, at least, supervisors conventionally disclaim
authorship (or rather, they do not assert).

To acknowledge their generosity and sacrifice, it is common to explicitly express our gratitude to them in our work.

A close and personal relationship, which will last for many years (or decades) to come, arises from such mutual respect.

ALVIN SEE Assistant Professor of LawSingapore Management University

B.C.L., University of Oxford, 2010

C.L.P., Malaysia, 2009

LL.B. (First Class Honours), University of Leeds, 2008

Quality time supervising post-graduates

I REFER to the letter “Stop practice of free riders” (The Star, Feb 7 - attached below) by Pola Singh.

The writer has missed the point by many miles. He has called supervisors by many idioms! One of which is “lembu punya susu, sapi dapat nama”.

He
has misunderstood the whole process of postgraduate education. I don’t
think there are any supervisors who will force a student to work under
him like a “slave”. It is the student who chooses to work with a
particular supervisor.

The graduate student–supervisor
relationship is very personal and close. Yes, the student has to do all
the work under the close supervision of the supervisor. The supervisor
obtains grants for his research and allows you to use the money to do
your research. There is no reason why he should not claim first
authorship.

Of course in any publication there is no need for the
supervisor to put his name first, but the corresponding author must be
your supervisor. You cannot be the corresponding author simply because
you will not be able to answer the reviewers’ queries as well as he.

If you can, then you don’t need the postgraduate degree and you don’t need the supervisor.

Many professors and supervisors spend hours discussing, correcting and guiding many students to their postgraduate degrees.

Stop practice of ‘free riders’
I FEEL compelled to write after hearing the tales of graduate
students pursuing their doctorate degrees at local universities who are
exasperated with their professors for making use of them for their own
ends.

Graduate students, particularly those doing their doctorate
degrees, are at the mercy of their professors who demand this and that.

Topping
the list of unreasonable demands is the co-authorship of papers based
on the research done by the student for his PhD dissertation.

It
is the student who painstakingly prepares the literature review,
formulates the hypothesis, collects and analyses the data, draws up
conclusions and makes recommendations.

Yes, the conscientious
professor guides the student all the way (which in any case is part and
parcel of his work) but when it comes to the publication of a manuscript
based on the research findings, guess who gets all the credit?

Professors
take for granted that in an unequal relationship, they will get credit
for the hard work put in by the student and this is manifested by
putting their name as the first author of the research paper.

No
straight-thinking student would challenge this. In the worst case
scenario, the student’s name does not even appear on the manuscript.

It’s akin to the saying “Lembu punyi susu, sapi dapat nama”.

Call this a form of exploitation but it is taking place all the time.

This imbalance of power leads some to label the students as “slaves”.

No
matter how friendly and accommodating professors are, they still hold
considerable power in deciding when the student will graduate.

Some
nasty professors demand that the thesis be rewritten again and again
and this frustrates the student who will do everything and anything to
complete his doctoral degree as soon as possible.

We can
understand why students are so afraid to bring such matters up to the
higher authorities. In the process, they suffer in silence and the
problem remains buried deep in the ground.

And it’s hard to say
“no” to a professor’s unreasonable demands because grad students need
the support of faculty members, who may happen to be members of their
dissertation committee, to pass and approve their thesis.

Many of
the department heads are so busy and sometimes overburdened with their
administrative duties that they have hardly any time to do serious
substantive research.

But as they aspire to go higher they need
to beef up their resume by coming up with more publications. This will
also increase their prospect of promotion and getting the elusive JUSA
(super scale) post.

Guess who does all the “donkey work” for
them? And yet some of these selfish professors do not even acknowledge
the contribution of the student, although their contribution in the
preparation of the paper has been minimal.

It’s easy to know who the culprits are.

Just
ask the academicians to submit a list of their publications and notice
the number of times the name of the professor is listed as the first
author followed by the students.

Sometimes, the subject matter or topic of a paper is the same but the student’s name is left out entirely.
This practice of “free riders” in the academic circle has to stop.

Graduate
students cannot be forever exploited. Vice-chancellors should not
condone such practices which are regarded as a norm not only in Malaysia
but also in developed countries.

A system has to developed by the Higher Education Ministry to ensure students get due credit for the work they have done.

What
can be immediately done is to send a circular that a professor cannot
take ownership of an article or paper that has been prepared entirely by
the graduate student based on his dissertation work.

If it is warranted, the professor’s name can be listed not as the first author but as co-author.

GANESH Kumar Bangah turned 23 in true techpreneur style. He listed a
company, entered the Malaysian Book of Records as the youngest chief
executive officer of a public-listed company, and pocketed his first
RM1mil.

That was in 2002. Just a few years earlier, he had merely
been an ambitious engineering undergraduate. He had been managing
cybercafs and peddling a proprietary cybercaf management system, having
developed it with a business partner.

“We started out selling the
software but decided during the dotcom bubble to give it away for free
in return for control of the first screen that people viewed so we could
offer eyeballs,” Bangah recounts. Their plan was to sell advertising
space on that prime landing page.

Call it guts or luck, he even got Vincent Tan, founder of the Berjaya Corp
conglomerate and one of Malaysia's richest men, to bankroll his little
start-up called Money Online or MOL. “Tan was one of the early movers
who recognised the potential of the Internet and was investing in
businesses in the industry, ” says Bangah.

With a financial
backer onboard, Bangah dropped out of university to focus on the
business. Within a year, he had signed up 15,000 cybercafs from around
the world. It should have been a shoo-in success, but monetising the
Internet in Asia in the early 2000s was not easy.

Internet
penetration in Malaysia at the time was just 15% of the total
population, a mere 3.7 million. And in pre-Google AdWords days, online
advertising was a tough idea to sell.

So Bangah switched his
focus to the online payment business instead. Rather than give the
software away for free, the cybercafs were asked to pre-buy a certain
amount of MOLPoints, which they could resell to their customers. These
points could be used to transact safely online.

Unfortunately,
e-commerce was just catching on, and consumers still preferred the
comfort and certainty of shopping the bricks-and-mortar way. Bangah
decided if there wasn't a market for his points, he would create a
demand for them by selling prepaid airtime reload coupons online and
making it a currency of choice for online gaming.

“There was a
game from (South) Korea that was very popular with gamers at the
cybercafs. It was free to play but I had a hunch they would soon start
charging,” he recalls. “So I went to the game publisher and secured the
exclusive rights for the game in South-East Asia.”

It was an
astute call that gave Bangah his much-needed break and set MOL on course
to being one of Asia's largest end-to-end content, distribution,
e-commerce and payment networks today. His MOL Global group comprises
MOLPoints, an Internet wallet for purchasing game credits, content and
services; MOLReload, which facilitates the distribution of prepaid
airtime; and MOLPay, an e-commerce payment solution gateway.

Online
gaming remains his sweet spot with sale of MOLPoints, predominantly for
gaming credits, accounting for more than 80% of profits. “We control
about 70% of the market in Malaysia and about 40% of the region,” says
Bangah. He estimates that MOL is also among the top five leaders in the
game payment industry globally.

“MOLPay is our fastest growing business even though it accounts for only 20% of revenue now,” he says.

MOL
handles over 60 million transactions annually with a payment volume of
over US$500mil (RM1.55bil). This strength comes from having a complete
payment universe: Content and distribution channels plus online and
offline payment options.

“In the case of online gaming and
content, it is a chicken-and-egg situation. Content partners will sign
up with you only if you have channels, and channel partners will do so
if you have content. So our success comes from having both,” Bangah
explains.

It is a position he continues to strengthen by
continually signing up new content publishers, which at last count,
stand at over 500.

This is complemented by MOL's links with more
than 1,000 payment partners worldwide. These comprise over 680,000
physical retail payment channels across 80 countries, 88 online banks in
nine countries, and major international payment systems.

In
2009, Bangah scored another coup when MOL acquired Friendster for an
undisclosed amount. While the pioneer social networking site may have
lost much of its luster with the entry of Facebook, MySpace and other
similar sites, it still had a huge Asian following of over 100 million
members.

Bangah is quick to clarify that buying Friendster was
not about mounting a challenge against Facebook. “Friendster is a global
brand while MOL was then primarily a Malaysian brand. Owning it has
helped the MOL branding and opened doors for us to big players,” he
says.

“We also bought it for its community. We thought that if we
could convert 1% to 2% of Friendster's members into MOL members, it
would be quite substantial. And we have done that our membership now
stands at two million.”

Then, of course, there were the patents
Friendster owned, which MOL subsequently sold to Facebook in a
cash-plus-stocks deal, reportedly valued at US$40mil. Bangah declines to
comment on this citing a non-disclosure agreement.

Bangah has
since turned Friendster into an online social gaming and discovery
portal, a move that hopes to build up MOL's revenue from online gaming.

Since the acquisition of Friendster, that revenue has already tripled.

Now
his plan is to go global with MOL. Having built strong footholds in
Malaysia, Singapore, Thailand, Indonesia, and the Philippines, the group
is expanding into Vietnam, Turkey, the United States, Brazil and
Australia.

The last two years saw the group buying several online
content distributors and payment service providers to realise this
ambition: Zest Interactive in Thailand; LoadCentral in the Philippines;
Ocash in Australia; and Rixty in the United States.

As far as Bangah is concerned, he has barely skimmed the surface. His target is to become a company with US$1bil in revenue.

“As long as online gaming grows, we in the platform business will grow.” - China Daily By ELAINE TAN

Sunday, 17 February 2013

IN view of the weaker loan growth this year, which banking stocks will prove to be winners?

From
the softer loan growth reported in December 2012, moderating at 10.4%,
analysts expect loan growth will continue to weaken this year.

The 10.4% loan growth in December compares with a growth of 13.6% and 12.8% in 2011 and 2010 respectively.

Most
analysts estimate loan growth this year to be within the 9%-11% range.
“Together with the ongoing interest margins headwind, there are limited
opportunities to drive earnings growth for banks materially beyond our
current expectation of a high single-digit to low-teen growth,” says a Kenanga Research analyst.

“I suppose our 7%-9% forecast is lower than other analysts’ 10%-11% forecasts due to our assumption that the Economic Transformation Programme (ETP)
related loans may not be a key loan driver this year, given that
significant amount being disbursed in 2012 could be repaid this year,
which could drag the business loan growth momentum for 2013,” he says.

However,
Cheah expects housing loans to resume its reign as key loan drivers
this year, on the support of the continued robustness in property loans
and recovery in hire-purchase loans.

Lending indicators turned
negative in December with loan applications falling flat with a 14.6%
year-on-year drop at RM53.6mil while approvals and disbursement
activities dropped by 21.1% and 7.9% on a year-to-year basis
respectively.

“The fall in lending indicators support our
investment case that both lenders and borrowers are turning cautious
with the impending 13th general election, which has to be called by the
first half of 2013, and is now widely expected to be held in March,”
says Cheah.

As
at end-2012, business loans outstanding expanded by 9% year-on-year due
to slower disbursements and base effect. Meanwhile, household loans
continued to expand by 11.5% from a year ago.

“Drilling deeper
into the business segment, the slowdown in year-on-year loan growth was
mainly caused by transport, storage and communications as well as other
sectors, with loans to these sectors contracting by 8.2% and 17.4%
year-on-year respectively,” RHB Research analyst David Chong says.

He adds that it is possibly a reflection of lumpy repayments or refinancing via debt capital markets.

CIMB Research
banking analysts Winson Ng says the weak lending loan indicators do not
point to a strong rebound in loan growth in the coming months. “On the
other hand, we think that the erosion of net interest margin will be
less drastic this year as banks will be more rational in their pricing
of loans after the stiff rate competition in the past two to three
years,” he says.

Ng reiterates his “neutral” rating on Malaysian
banks. He adds that asset quality is expected to remain intact, which
alleviates fears of a spike in credit costs for new impaired loans.
“There are still some positives for Malaysian banks including financing
opportunities from ETP projects, undemanding calendar year 2013
price-earnings of 11.5 times, and an attractive net dividend yield of
4.5%,” he says.

The banking sector could face two potential
de-rating catalysts, which could pose further downside risks to
analysts’ loan growth forecasts for 2013.

“Lending activities
could decelerate in the first quarter of 2013 with slowing corporate
loan disbursements and consumers turning cautious pending the upcoming
general election,” Cheah says.

Another catalyst would be if the
Government were to implement the goods and services tax (GST) and resume
the subsidy rationalisation programme and raise the electricity tariff
to close its budget deficit. “This fiscal tightening policy could have
an adverse impact on consumer spending and consumer loans in the later
part of the year,” says Cheah.

CIMB
notes its preference for big banks that have better defensive
qualities. “Maybank’s diversified business portfolio with top-three
ranking in all business segments will enable it to reap the greatest
benefits from the implementation of the broad-based ETP,” Ng says.

He
adds that Maybank’s key earnings catalyst will be its rapid expansion
in Indonesia which will enable the group to gain market share in the
region and fuel its fee income growth.

Fundamentals

Meanwhile, Public Bank Bhd’s
fundamentals remain unrivalled, with a return on equity in the mid-20
percentage point range, the best asset quality with an impaired loan
ratio of below 1% and a cost-to-income ratio of 30%.

“We expect
the group to keep its credit cost low in 2013 to 2014, thanks to its
superior asset quality, especially with the full adoption of FRS
(Financial Reporting Standard) 139. Loan growth is projected to be a
decent 11%-12%. The push for fee income growth, primarily from wealth
management and bancassurance, will provide a further fillip to topline
growth,” Ng says.

However, Alliance Research believes that Public Bank’s future risk-reward dynamics are less appealing.

“With
the election uncertainties expected to be cleared by the first half of
2013, we believe that Public Bank may underperform its higher beta
banking peers post-elections,” Cheah says. This is coupled with its rich
2013 price-to-book valuation of 2.8 times and declining asset growth
trajectory.

Cheah expects high beta banks that underperformed in 2012 to outperform its competitors in 2013.

“RHB Capital Bhd serves as our top pick of the banking sector since we believe that its current low valuation is no longer justified,” he says.

In the mid-cap section, Cheah has cast his eye on the often-overlooked Affin Holdings Bhd due to its turnaround story and good proxy to the merger and acquisition theme.

For investors looking for a direct and pure exposure to the fast-growing Islamic banking sector, BIMB Holdings Bhd is the way to go, says CIMB’s Ng.

“Re-rating
catalysts include the best loan growth among the Malaysian banks under
our coverage, the potential to venture into the under penetrated and
fast-growing Indonesian financial market, brisk fee income growth,
primarily from its takaful operations, and expected expansion of its net
interest margin by optimising its loan-to-deposit ratio which is
currently only 50% plus,” he says.

RHB Research and Kenanga
Research remain “overweight” on the banking sector, while Alliance
Research and CIMB Research maintain their “neutral” stance.